Lawyer Watts quits BP fight amid probe

Updated 10:48 pm, Thursday, March 14, 2013

In the face of a federal investigation into the legitimacy of his client list, nationally known San Antonio plaintiffs lawyer and Democrat stalwart Mikal C. Watts has resigned from litigation over the 2010 BP oil spill in the Gulf of Mexico.

Watts tendered his resignation recently from the plaintiffs' steering committee, an exclusive group of lawyers handling tens of thousands of claims against BP and other companies that settled over the disaster.

U.S. District Judge Carl Barbier of New Orleans, who's presiding over the multidistrict litigation, entered an order Wednesday documenting Watts' resignation.

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Watts is known for donating more than $7 million to Democratic campaigns in San Antonio, in Texas and in national races.

Last July, he held a private $35,800-a-plate fundraiser at his home in The Dominion for President Barack Obama.

“Mikal's primary concerns are the people who were injured by BP's and others' gross negligence,” said his lawyer, Mike McCrum. “Mikal didn't want the fact of this investigation to impact the opportunity for plaintiffs to receive compensation for their injuries, so he voluntarily removed himself from the committee. We believe he continues to have the full support of the members of the committee.”

McCrum said Watts could later apply to the judge for reinstatement.

Watts' resignation comes three weeks after the San Antonio Express-News first reported that the Secret Service raided his two law offices in Northwest San Antonio, and confirmed with authorities that they were part of a federal investigation into his client list in the BP litigation.

The New York Times first reported in 2011 that Watts was accused of discrepancies in the litigation against BP as he made his way onto the plaintiffs steering committee. A large list of clients can help secure a seat on the committee.

Lawyers on such committees typically reap a financial bonanza for their efforts.

Watts told the Times at the time that he had more than 43,000 clients in the BP case.

All of them, he told the Times, came through referrals from other lawyers. He also said they all were substantiated, and that he had a “contingency-fee contract with every client.”

But the Times report said Watts met with resistance from the BP compensation fund when he tried to file emergency claims for all of his clients.

When the fund questioned the number of clients, Watts tried to file fewer, about 26,000, the Times reported.

Some people tried to file on their own and were denied because fund officials told them claims already had been filed on their behalf.

Some maintained they never signed up with any lawyer, but found claims had been filed on their behalf, the Times reported.

Others along the coast said they had handed over financial records to people who promised them quick and free financial assistance, only to discover later that they actually had hired a lawyer. Still others told the Times they were misled into signing up for a lawyer by being told they were applying for medical assistance.

McCrum wouldn't comment on the client list or matters related to the investigation, but said Watts “continues to assert his innocence and looks forward to clearing his name.”

Some lawyers remaining on the plaintiffs steering committee referred questions Thursday to a committee spokesman, who could not be reached for comment.